Now there’s a question on a lot of people’s lips…
There are some very good Interest Rate offerings coming out lately which are really encouraging. A fixed Rate is a nice option for a lot of home owners.
It offers a guaranteed interest rate and therefore fixed repayments which can really give peace of mind in difficult times.
The downside being, that a lot of fixed rate loans are quite a handcuff. You can be limited to how much extra you can pay and they can be very expensive to get out of early.
Whether you fix or not is a personal choice, if it helps you sleep at night then you should definitely consider it.
The convenience of knowing that your payments will not change for a set period of time, can give a great reassurance to many.
On the flip side, the beauty of a variable rate loan is they are considerably more flexible than a fixed rate loan. You can normally pay as much as you like as often as you like and have far easier access to redraw any surplus funds you may have in the loan.
Each has its pro’s and con’s but as I keep saying, you just need to make as informed a decision as you can. If you do that then you should be able to sleep comfortably with the decision you’ve made. To me the ‘sleep at night’ factor is very important but it’s just my opinion. You must do what is right for you.
What are your thoughts?